Mortgage acceleration software may not offer the Utopia people anticipate or are promised.

My Experience with Mortgage Acceleration Software

Years ago, when I first heard of the idea of using a home equity line of credit to accelerate mortgage principal payoff through a technique also known as HELOC cycling, I had the opportunity to subscribe to some online software for a monthly fee. Typing all my numbers into it shouldn't have been too hard, because I kept my finances in QuickBooks Professional. All I'd have to do is look up the answers to the questions, copy and paste.

That would be true if the developer of that software categorized expenses the same way I did. And built the software to function in a combination residential home-business environment. Neither of those was true, but I finally mostly finished the task — as close as I could get with someone not asking the questions I had the answers to.

There were some problems with the 30-day software subscription, unfulfilled promises, etc., and the company gave me six months for free. I didn't care. I had no inclination to spend an evening a week trying to make my real life and the software developer's imagination and terminology merge. After another visit or two, I quit logging in to the site.

Why Let Your Mortgage Make you Rich Doesn't Come with Software

Years later, when my friends persuaded me to write down my experience the prior two years in cutting $70,000 interest off my own mortgage, and talking with others about how they could do the same with theirs, I didn't have to think more than five seconds to know I did not want to put software into the mix.

Why? Because lots of good people I know don't even balance their checkbooks! I balance mine to the penny. (An old bookkeeping supervisor I had years ago, Mrs. Callaghan, said, "If it's off by a penny, it could be off by a thousand dollars. You have to find it.") If I, balancing credit card and bank statements to the penny didn't enjoy or feel enriched by using software to manage my own mortgage acceleration plan, how could I offer my readers success if they  had to use software to succeed?

I would find managing all my accounts challenging without accounting software. But the only numbers we need to manage mortgage acceleration are obtained by looking at the totals in each account. We do not "track" our projected payoff date. As I said in my last blog, a fancy mirror isn't going to make your hair look any better. Knowing the date isn't going to change what we do. We do the best we can on a week by week basis. So far in our lives, that's proven good enough.

What I Hear about Money Merge Account Software

When people first get on the Money Merge Account software from United First Financial, according to what I hear and what I read, they get really excited. After tirelessly entering every bill and annual expense, every paycheck and bonus, they garner a projected payoff date for their mortgage. It's exhilarating. They can see exactly where they're going.

Then they cut back on their expenses. They don't buy popcorn the next time they go to the movies, because if they don't, $20 more will go to pay off their home. This newly inspired frugality supercharges them and their payback approximations get shorter.

Then they have five days of non-stop work, day and night. They've eaten out, bought ready-made coffee drinks, didn't get a receipt at the Arco station…now it's Saturday morning and they have to log in to their money merger account and try to catch up. Subtract this and this and this…and that other amount that I don't remember.

What I hear is that after about six months of thrills and chills on the software, then come the spills. Not for everyone, but for some. Logging in to the software daily to adjust income and expenses so the projection comes out right becomes a task rather than a joy — a dreaded task. Your payoff date is staring you in the face every time you log in. If you throw your five year old a birthday party with a pony ride, it will add a week to the time you own your house. It's the kid's fault you don't own it already. You should have bought the software before you even had kids, because then you would have thought twice about how expensive they are! But it wasn't on the market five years ago! What's this world coming to?

Software or Not

Strict records shouldn't be a problem. But they shouldn't beat you up or make you feel bad either!

The fact is, people who use the MMA software long term, and the people using the principles of money cycling without special software, come out about the same time frame on paying off their homes. One may be ahead with software by $1000 or $2000; another may be ahead $1000-$2000 without using software.

Ultimately, it's how well you live within your means that makes all the difference…If you need software to make you behave, how did you get as far in live as you've gotten?